Meridian will acquire all of the issued and outstanding common shares of Cancana in exchange for shares of Meridian pursuant to a statutory plan of arrangement under the Business Corporations Act (British Columbia).

The intention is to streamline the ownership structure of Cancana’s and Meridian’s joint venture exploration and development project, Brazil Manganese Corp. (BMC).

Cancana securityholders, through their ownership of Meridian shares, will continue to participate in the accretion of value associated with the operation and further development of the BMC project. The BMC project is expected to benefit both from improved access to financing for its development and operational synergies as a result of the unified ownership pursuant to the arrangement.

Ownership of Meridian upon completion of the arrangement will be commensurate with the proportional beneficial interest in BMC as currently held by Cancana shareholders and Meridian, but with a 20-per-cent premium for Cancana shareholders. Subject to the terms set out in the arrangement agreement, Cancana common shareholders (other than Meridian and its affiliates, which currently hold approximately 47.2% of the common shares of Cancana) will receive 0.4 Meridian share.

Upon the completion of the arrangement Meridian will hold 100% of the shares of BMC, and former Cancana shareholders will hold approximately 11.5% of the shares of Meridian equating to an aggregate beneficial ownership interest of 11.5% of BMC.

Currently Cancana holds 18.5% of BMC, and Cancana shareholders other than Meridian and its affiliates hold an aggregate beneficial ownership interest of approximately 9.6% of BMC. Consequently, as a result of the arrangement Cancana shareholders will receive a premium of approximately 1.9% of BMC beyond what they would have received had the distribution of shares of Meridian mirrored the shareholdings in BMC.

Outstanding stock options of Cancana will be exchanged for Meridian shares based on the in-the-money amount of such stock options. Upon completion of the arrangement, the Meridian shares are expected to assume Cancana’s listing on the TSX Venture Exchange and Meridian will become a reporting issuer in Canada.